Gabe Newell said that Apple may be the main problem with getting the Steam Box into living rooms.

Newell, Valve's co-founder, told a class at the University of Texas' LBJ School of Public Affairs that Apple could be a threat to his company's upcoming Steam Box if it gets to the living room first.

Steam Box is Valve-developed hardware that aims to broaden the reach of Steam, which is Valve's digital distribution and multiplayer/communications platform. Right now, Steam delivers a variety of games to a user's desktop computer, but Steam Box will bring these games to the living room -- such as on a TV with Big Picture mode.

Not much else has been disclosed about Steam Box, other than the fact that it's Linux-based and will be an open system (Newell even said that it'd be possible to install Windows onto the Steam Box). While no release date is in sight, Newell worries that Apple may launch a similar platform for the living room -- thus beating Valve to the punch.

"The threat right now is that Apple has gained a huge amount of market share, and has a relatively obvious pathway towards entering the living room with their platform," Newell said. "I think that there's a scenario where we see sort of a dumbed down living room platform emerging — I think Apple rolls the console guys really easily. The question is can we make enough progress in the PC space to establish ourselves there, and also figure out better ways of addressing mobile before Apple takes over the living room?"

While Valve is looking to offer the best hardware for the best possible price point, Newell worries that Apple may make a move first and offer a closed platform that will lack the user-generated content that Valve (through Steam Box) would offer.

"The biggest challenge, I don't think is from the consoles," Newell said. "I think the biggest challenge is that Apple moves on the living room before the PC industry sort of gets its act together."

quote: It's sad to see that Steam is going to destroy itself just like Microsoft is in its mad, pointless quest to chase Apple's former glory. And for what? The Apple bubble has popped and their profit shares have nowhere to go but down; this isn't 2009 anymore.

A word of caution.

Back in the late 1980s and early 1990s many Mac users convinced themselves that the popularity and business success of Microsoft was some sort of temporary aberration, a fluke, and that soon Microsoft would be put in their place as purveyors of substandard ugly software. Because Mac users tended to mostly talk to other Mac users that delusion was sustained for a long time but it's only result was that we suffered a long period of false hope followed by bitter disappointment and, more importantly, completely failed to understand what made Microsoft strong and Apple weak. We became disorientated and depressed because it seemed the tech world had gone wrong, but actually the problem was that we didn't understand the reality of the tech world as it was because the reality of the tech world was so deeply unpalatable. So we hid inside comforting fantasies which felt real because we parroted them back forth to each other.

I notice many people making a similar mistake when convincing themselves that Apple's growth, size and success is some sort of temporary aberration and a big correction is coming that will put Apple in it's place (that place being, of course, a niche player). But it's not going to happen. Apple now have in place all the business components to remain a huge presence in the mobile device market for possibly as long as a decade, certainly for the next five years. Apple will continue to grow (although that growth will slow), will probably double in size, and will be the world's largest tech company by any business metric. Apple's mobile platform, iOS, is going to be the biggest mobile platform by value for a long time, it's possible Android may never equal it in terms of platform value and utilisation. If you wish to avoid disappointment and frustration and if you wish to really understand the dynamics of the modern tech markets you need to accept that reality. You don't have to do that of course, you can continue to find comfort in the idea that the Apple bubble has burst or is about to burst but you will condemn yourself to years of disorientation.

Very well said... I don't think Apple is as important as you, obviously, but the jist of it is right on. Apple will remain a big player. This time they got past the bubble that they missed in the early 90's. I don't think the growth will continue, it will level off. That doesn't mean they are going away. They will just go from being ridiculously record breaking profitable to merely extremely profitable and stay there. A great place for a company to be.

"If you look at the last five years, if you look at what major innovations have occurred in computing technology, every single one of them came from AMD. Not a single innovation came from Intel." -- AMD CEO Hector Ruiz in 2007